Governance of innovation in the European railway sector

The European railway sector has undergone major transformations over the past two decades. Domestic reforms have been buttressed by European directives aimed at creating a single European railway market. In this new environment roles have been significantly redistributed, leading to new organizational models. A new and dynamic equilibrium is emerging, to which all railway stakeholders are trying to adapt. The paper looks at the European Rail Traffic Management System (ERTMS) from the innovation perspective. It argues that the concurrent liberalization of the sector and the technical harmonization (via the introduction of a pan-European signaling technology) have fragmented the railway sector on different levels (e.g. technological and organizational). The difficulties in developing and deploying a pan-European standard attest to the necessity of re-thinking innovation processes in the railway sector, particularly when those relate simultaneously to infrastructure management and operations. Among others, a broad consensus/alignment of the stakeholders on the type of performances aimed for (e.g. social, technical, operational, environmental or financial) need to be explicitly integrated in railway market organization models and by extension in railway innovation models. The article contributes to the analysis of innovation in large technical systems (LTS) by introducing a framework of performance objectives for the governance of innovation in LTS.